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Access Bank Positions Self for Possible Negative Shocks

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By Dipo Olowookere

Group Managing Director of Access Bank Plc, Mr Herbert Wigwe, has assured that the lender was strong enough to withstand any macroeconomic challenges that may come its way.

Mr Wigwe gave this assurance while reacting to the solid earnings delivered by the bank in the first quarter of 2019.

In the Q1 2019 results, the financial institution reported a double digit growth in its topline, bottomline and balance sheet.

Business Post reports that Access Bank grew its gross earnings by 16 percent to N160.1 billion in Q1 2019 from N137.5 billion in Q1 2018, with interest and noninterest income contributing 69 percent and 31 percent respectively.

Also, interest income appreciated by 16 percent year-on-year to N110.8 billion in Q1 2019 from N95.6 billion in Q1 2018, with the non-interest income rising to N49.3 billion in Q1 2019 in contrast to N41.9 billion in Q1 2018.

In addition, the profit before tax for the period rose by 66 percent to N45.1 billion from N27.2 billion, while profit after tax increased by 88 percent to N41.2 billion from N21.9 billion.

Furthermore, the asset base of the bank remained strong and diversified with growth of 30 percent YTD in total assets to N6.43 trillion in March 2019 from N4.95 trillion in December 2018, with the net loans and advances totalling N2.74 trillion as at March 2019 against N2.14 trillion in December 2018.

Customer deposits increased by 53 percent to N3.92 trillion in March 2019, from N2.57trn in December 2018, with the Capital Adequacy Ratio (CAR) remaining adequate at 19.5 percent, reflecting the impact of its merger with Diamond Bank late last month.

Taking into consideration the regulatory transitional arrangement of IFRS 9 implementation, CAR stood at 23.0 percent, while liquidity ratios of 47.6 percent versus 46.30 percent in December 2018 remained well above regulatory requirements.

The non-performing loans (NPL) ratio stood at 10.0 percent as at March 2019 in contrast to 2.5 percent in December 2018, with the cost of risk decreasing to 0.5 percent in Q1 2019 from 1.0 percent in Q1 2018 due to adequacy of provisions taken as at December.

Commenting on the results, Mr Wigwe said, “The group delivered solid earnings underscoring the value potentials of the newly expanded business model. Gross earnings showed a 16 percent increase to N160.1 billion from the prior year, comprising strong earnings on interest income and non-interest income of 69 percent and 31 percent respectively, whilst profit before tax (PBT) grew by 66 percent to N45.1 billion.

“Our capital and liquidity position remained above regulatory levels, with CAR at 19.5 percent and liquidity ratio of 47.6 percent further demonstrating the capacity of the enlarged balance sheet to cope with possible negative shocks.

“Following the successful completion of the merger with Diamond Bank in March 2019, we have now fully positioned ourselves in the retail market with a view to bringing the power of banking to the doorsteps of millions.

“We are providing a broader platform to facilitate payments services in Nigeria and across Africa, by harnessing our significantly enhanced digital technology capabilities.

“We have made solid progress throughout the first quarter of 2019 in line with our 2018-2022 five-year strategy, and we remain committed to the achievement of our strategic imperatives going forward; as we continue to invest in our people, technology and most importantly, our product offerings to customers.

“Our focus is to become the world’s most respected African Bank by leveraging on the strength of our retail and wholesale business to provide unrivalled value to our customers.”

Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan. Mr Olowookere can be reached via dipo.olowookere@businesspost.ng

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Banking

MFS Africa Expands into Nigeria With Baxi Acquisition

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Baxi

By Sodeinde Temidayo David

Nigerian fintech startup, Baxi, has been acquired by the Pan-African payments company, MFS Africa, giving way to its business expansion into Nigeria.

The acquisition of the Nigerian firm was sealed after MFS Africa signed an agreement with Capricorn Digital, Baxi’s parent business, for an undisclosed amount.

Founded in 2014, Baxi provides a cash-in or cash-out offering as well as value-added services like account opening, money transfer, bill payment and more, through its network of more than 90,000 agents.

These services are provided through the company’s retail network of agents and merchants in some of Nigeria’s most remote regions, through its BaxiBox POS, BaxiPay, Baxi MPoS Device, and BaxiRIMS products.

Recall that MFS Africa had earlier acquired East African payments management startup Beyonic, a Ugandan fintech startup and this time also, has plans to build Baxi into a key node on its digital payment network, allowing customers to make regional and global payments to and from Nigeria.

The deal, which is subject to approval from the Central Bank of Nigeria (CBN), sees MFS Africa expand into Nigeria for the first time, having had a limited presence thus far due to the country’s small number of mobile wallets.

MFS Africa will also expand Baxi’s proposition for offline SMEs to select markets within MFS Africa’s footprint of 320 million mobile wallets across more than 35 African countries.

Speaking on the acquisition, the Chief Executive Officer (CEO) of  Capricorn, Mr Degbola Abudu, expressed that the future of the mobile payments landscape in Africa is a game of few, where consolidation is the way forward, and attempting to scale alone would require more capital expenditure and a longer time to execute.

“By teaming up with MFS Africa, and with the strong support of our local commercial banking partners, we can offer more value-added products and services, such as cross-border payments, to support Nigerian SMEs in their growth.”

“We believe that we’ve barely scratched the market’s potential. The deal brings many things that allow us to grow very quickly,” Mr Abudu noted.

MFS Africa intends to build Baxi into a key node on its digital payment network, allowing customers to make cross-border payments to and from Nigeria, similar to what it’s done with mobile money operators across Africa.

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Nigerian Digital Lender Brass Gets $1.7m to Support SMEs

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Brass

By Ashemiriogwa Emmanuel

Provider of premium banking services for African Small/Medium Enterprises (SMEs), Brass, has raised the sum of $1.7 million in a funding round to strengthen its financial services rendered to local entrepreneurs, traders, and fast-growing businesses across the continent.

Investors who participated in the round included the co-founder of Flutterwave, Mr Olugbenga Agboola, co-founder of Paystack, acquired by Stripe, Mr Ezra Olubi, Hustle Fund, Acuity Ventures, Uncovered Fund, and Ventures Platform.

Brass’ past investors have included Olumide Soyombo of Voltron Capital, Leonard Stiegler, Fola Olatunji-David, Yemi Lawani, and two senior executives from major Nigerian banks.

With the fresh funding, the Nigerian digital bank is set to launch a number of new product categories, which will lead to expanding its credit market presence.

Even as the startup is looking at broadening its customer base, the new financial capacity will facilitate its plans to accelerate its expansion into other African countries such as South Africa and Kenya.

Explaining further on the significance of the fundraising, the Co-Founder and CEO of Brass, Mr Sola Akindolu, who is a former Head of Product at Kudi Bank, noted that the contributions made by these investors, together with their expertise, will not only play a vital role ahead of Brass’s expansion into South Africa and Kenya, but also in the future ambitions outside of the continent.

“The basic needs of Africa’s SMEs are just as significant and unique as those of the customers they serve each day and now more than ever, we need innovative and world-class financial services solutions that meet their expectations.

“These local businesses have supported our economies for decades, forming the backbone of Africa’s success to date, and now is the time to bet on them.”

“At Brass, we’ve made some great strides over the last year in tackling one of Africa’s most critically underserved customer bases but with an estimated $5.1tn credit gap globally, our work is far from over,” he added.

Expressing excitement over the investment, Mrs Elizabeth Yin, General Partner at Hustle Fund, one of the investors, said “We believe Africa’s entrepreneurial ecosystem, and fintech sector is witnessing an unprecedented shift, and Brass is at the forefront of that, supporting local businesses and professionals with banking technology to supercharge their growth. We are excited by their vision, and honoured to be joining them on their journey.”

Founded in July 2020, Brass offers full-stack, commercial-grade banking solutions to SMEs cutting across different business classes, allowing them to gain greater clarity and control over their money operations.

Brass online platform provides a wide range of business banking needs, including credit and payment services, payroll and expense management, Application Programming Interface (API) support, and other essential business services.

Having disbursed over $2 million in credit to business since inception, Brass’s recent solution which is ‘Brass Capital’ helps thousands of businesses scale up with its cash-flow financing design.

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Ecobank Staff, Families Raise Awareness for Mental Health

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Ecobank Day mental health

By Dipo Olowookere

On Saturday, October 23, staff and families of the pan African financial institution, Ecobank Transnational Incorporated (ETI) across 33 countries of its operations on the continent will raise awareness for mental health.

This is a flagship annual event of the lender tagged Ecobank Day and in Nigeria, there would be impactful discussion sessions and mental health empowerment training programs to further raise awareness and help reduce stigma and discrimination in the country.

A statement issued by the Head of Marketing and Corporate Communication at Ecobank Nigeria, Mr Jide Sipe, disclosed that this year’s Ecobank Day is themed Mental Health – Time to Talk and Act! and it marks the start of the final year of the three-year campaign to raise awareness and help prevent Non-Communicable Diseases (NCDs) in Africa.

He further said a hybrid webinar will be hosted to “discuss mental disorders, raise awareness about them, and the care and support options available.”

“We will be encouraging people to talk about their feelings and suggest lifestyle behaviour changes which can also make a difference – like exercising regularly.

“There is often a lot of stigma around mental health. Those affected can face isolation, exclusion from work and family life, increased stress levels, negative addictive behaviours and substance abuse. No one should be made to feel ashamed because of a mental health issue. It can happen to anyone at any time,” he added.

It was gathered that some personalities invited for the programme include Dr Olusola Olowookere, Consultant Psychiatrist/Forensic Medical Examiner; Titilayo Medunoye, founder/CEO, Milky Express; Oluwakemi Akintoyese, Clinical Psychologist; Hadiza Blell-Olo, a humanitarian and artiste known as Di’Ja; Dr Tomilola Oyekunle, a registered psychologist and host of others.

Since the inaugural Ecobank Day in 2013, employees of the bank have supported a variety of causes and shown compassion for the welfare of various local communities.

Previous initiatives have focused on orphanages, cancer screening, education, maternal healthcare, safe water supply and malaria prevention.

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